Corrected: Storm-ravaged EG unit to find new life in Huntsman EO expansion

22 October 2013 21:59  [Source: ICIS news]

Storm-ravaged EG unit to find new life in Huntsman EO expansionCorrection: In the ICIS story headlined "Storm-ravaged EG unit to find new life in Huntsman EO expansion" dated 22 October 2013, please read in the seventh paragraph ... "by 265m lbs/year" ... instead of ... "by 265m tonnes/year". A corrected story follows:

PORT NECHES, Texas (ICIS)--Five years after Hurricane Ike tore a path of destruction through southeast Texas, a structure that fell victim to the storm was officially tasked on Tuesday with helping its current owner chart a course into the coming US ethylene boom.

Flanked by local government and company officials, CEO Peter Huntsman helped dedicate the groundbreaking of his company’s ethylene oxide (EO) plant expansion in Port Neches.

“This project for us is going to be very important because it is going to be the baseload for our downstream amines, surfactants, and to a lesser degree in importance … obviously the glycols business as well,” the CEO said.

The unit to be added on was originally an ethylene glycol (EG) facility in Beaumont owned by DuPont-Lyondell joint venture PD Glycol. But the plant ceased operations after Ike made landfall in September 2008, soon followed by the severe economic recession of 2009.

PD Glycol decided to put the facility up for sale, and Huntsman saw an opportunity, said Janice Latz, vice president of operations for Huntsman Performance Products.

Huntsman purchased the EG unit, took it apart and moved it by barge just a few miles down the Neches River to the company’s Port Neches facility, where the company is retooling it for EO production and integrating it into the site, which currently has two EO reactors.

When the former PD Glycol unit is fully up and running by the second quarter of 2015, the facility will become the largest single-site producer of EO in North America, Huntsman said, with capacity increased by 265m lbs/year, or about 25%. Currently, about 1bn lbs/year (453,600 tonnes/year) is produced at the facility, according to the company.

All of that EO will be consumed by the US-based producer to make a variety of ethylene-based derivatives such as glycols, surfactants and amines, with more than 90% of the EO used at the Port Neches facility, Latz said.

The location on the Texas Gulf Coast is ideal for Huntsman as it plans to take advantage of all the planned ethylene production increases made by other companies in the wake of the shale gas boom, said Stewart Monteith, president of Huntsman’s Performance Products division.

“I think this is a strategic site for us, and I think that it’s evident by the investment that we’re making here,” Monteith said. “I think this whole shale gas phenomena has changed the world’s economics now of where you invest and build. I think you see more scenarios … where people are investing back in the US and exporting products out because the economics now work in that favour.”

"This project here is the single-largest project we have anywhere in the world, so our corporate commitment is here," Peter Huntsman said. "We view this as the foundation of our company."

Huntsman is investing up to $150m (€110m) in the expansion, the CEO said. About 10 full-time jobs will be created at the site, along with 325 jobs during the construction phase and up to 10 full-time contractor positions, the company said.

But investment in EO production and Port Neches likely will not be limited to the current expansion, Monteith said. The company continues to analyse ways to maximise its business in the midst of the shale gas revolution.

“We have intentions of continuing to invest in this facility and continuing to derivatise off ethylene oxide,” Monteith said.

($1 = €0.73)

By: Jeremy Pafford
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